Beruflich Dokumente
Kultur Dokumente
1956
INDEX OF PRESENTATION
COMPANY
NATURE OF COMPANY
TYPES OF COMPANIES
PRIVATE Vs PUBLIC COMPANY
PRIVILEGES OF PRIVATE COMPANY
DOCTRINE OF CONSTRUCTIVE NOTICE
PROSPECTUS
MEMORANDAM OF ASSOCIATON.
ACTICLE OF ASSOCIATION.
CASES
COMPANY
In a simple words a company may be defined as a
association of persons who contribute money or
moneys worth to a common stock and employ it
in some trade or business , and who shares the
profit or loss there from.
Section 3(1)(i) of the Companies Act, 1956 defines a
company as: a company formed and registered
under this Act or an existing Company.Existing
Company means a company formed and
registered under any of the earlier Company
Laws.
Legal definition Incorporated association , which
is an artificial legal person, having a separate
legal entity , with a perpetual succession, a
common seal, a common capital comprised of
transferable shares and carrying limited liability .
NATURE OF COMPANY
1 SEPERATE LEGAL ENTITY
2.ARTIFICIAL PERSON
3.PERPETUAL EXISTENCE
4.COMMON SEAL
5.LIMITED LIABILITY
6.CAPACITY TO SUE OR TO BE SUED
7.TRANSFERABILITY OF SHARE
Separate legal entity
A company is an separate legal entity means it is
different from its members. It works as a individual body.
Artificial person
A company is a purely a creation of law. It is
invisible, intangible and exists only in the eyes of
law.
It has no soul, no body, but has a position to enter
or exit into a contract, to appoint a people as its
Perpetual existence [sec 34(2)]
Section 34(2) of the act states that an incorporated
company has perpetual life.
The life of the company is not related to the life of the
members . Law create the company and law alone can
dissolve it.
The existence of the company is not affected b y death,
insolvency, retirement or transfer of share of members.
Limited liability
It means that the liability of a member shall be
limited to the value of the share held by him, he
cannot be called upon to bear the loss from his
personal property.
Common seal
A company being an artificial person can not
work as a natural being.
Therefore, it has to work through its directors,
officers and other employees. Common seal used
as a official signature of a company.
Minimum paid up
1 Lac 5 Lacs
capital
Minimum no of
2 7
members
Maximum no of
50 No limit
members
Minimum no of
2 3
Directors
Restricted AOA &
requires the prior Shareholders can
Transfer of Shares
permission of Board of transfer shares freely
Directors
Private Vs Public Company ..Contd..
Private Company Public Company
AOA prohibits any
Can invite public to
invitation to public to
Public Subscription subscribe to its shares
subscribe to its sharess
& debentures
& debentures
AOA prohibits
Acceptance of public Can acceptance of
acceptance of deposits
Deposits deposits from public
from public
Only after getting the
Immediately after
Commencement of Certificate of
Certificate of
Business commencement of
Incorporation
Business
Need not prepare or file
'Prospectus' or Must prepare or file
Issue of prospectus 'statement in lieu of Prospectus with
prospectus' with registrar
registrar
Private Vs Public CompanyContd..
Private Company Public Company
Must hold after one month
and before 6 months from
date of obtaining the
Statutory meeting Not required to hold
Certificate of
commencement of
business
No Central Govt Central Govt approval is
Provisions approval for appointing must for appointing and
regarding directors and reappointing of MD reappointing of MD or
or Whole time director Whole time director
No restriction on
Managerial payemnt of Remuneration is fixed at
remuneration remuneration to 11 % of net profits
directors & MD's
Must maintain index of
Need not maintain
Index of members members if no of
index of members
members exceed 50
PRIVILEGES OF PRIVATE
COMPANY
Sec. Privileges
58A For Pvt.Co., amount received from its shareholders by a private
company is not included in the meaning of deposit. If the depositor
ceases to be a shareholder, the deposits made by him cease to
qualify for exemption from the date of such cessation
77(2 & 3) There is no prohibition on a Pvt. Co., which is not a subsidiary of a
public company, to provide financial assistance to anyone for
purchasing or subscribing for its own shares or of its holding
company.
81 A Pvt. Co. can issue further shares in any manner; i.e. rights shares
to the existing shareholders need not be offered.
Held
An incorporated company is a legal person separate and distinct
from its shareholders. The company, from the date of
incorporation, has perpetual succession and did not change its
identity or personality even though the entire share holding of
the company changed hands.
Case 2
Issue
Section 295 deals with loans given to directors and other companies. It is
alleged that Ackruti City gave loans to other companies in which its directors
were interested, without seeking the required approvals from the central
government.